Real Earnings Management and Accrual-based Earnings Management in Family Firms

Ann-Kristin Achleitner, Nina G�nther, Christoph Kaserer and Gianfranco Siciliano

European Accounting Review, 2014, vol. 23, issue 3, 431-461

Abstract: We examine the effects of family firms on real earnings management (REM) and accrual-based earnings management (ABEM). Using socioemotional wealth as a theoretical framework and considering the different implications of REM and ABEM on family firms' transgenerational sustainability, we hypothesise and find for a sample of 402 German listed family firms during 1998-2008 that family firms engage less in REM and exhibit more earnings-decreasing ABEM policies as compared to a sample of 436 non-family firms. We further provide evidence that family firms as compared to non-family firms treat REM and ABEM as substitute rather than complementary tools for earnings management. Overall, our findings suggest that family firms use earnings management activities strategically, avoiding those that inhibit the firm's long-term value (i.e. REM) and engaging in those that help families retain transgenerational control (i.e. ABEM).

Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (62)

Downloads: (external link)
http://hdl.handle.net/10.1080/09638180.2014.895620 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:euract:v:23:y:2014:i:3:p:431-461

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/REAR20

DOI: 10.1080/09638180.2014.895620

Access Statistics for this article

European Accounting Review is currently edited by Laurence van Lent

More articles in European Accounting Review from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().